The more things change, the more they remain the same. That is an old saying that keeps proving itself to be true, and nowhere do we see more change than in the telecoms and revenue assurance area. Since GRAPA’s founding in 2007 there have been several major revolutions in the practice of revenue assurance. We have seen revenue assurance move up in status and importance in many organizations around the world. We have seen revenue assurance teams grow quite rapidly in most telcos. We have seen the role of revenue assurance expand to include dozens of new domains and areas as CFO’s and CEO’s have come to appreciate the real value that revenue assurance can deliver to the bottom and top line of the company’s financial statements.

We have even seen the revenue assurance professional move up to an almost C-level type standing in some of the more progressive and innovative telecoms. So, as the president of GRAPA, I have to ask myself a very serious question. Where do we go from here? How can we, at GRAPA continue to support the growth and increase in status of the revenue assurance professional, and how can we get even more creative in figuring out ways to help expand the reach of revenue assurance, as well as the effect?

I cannot tell you the complete answer to this question, because I just do not know. But I do know that we are redoubling our efforts in several areas. There seems to be a pattern emerging that we are going to try to develop, and that is in the area of specializations.

Clearly revenue assurance has greatly increased in scope over the past few years. Revenue assurance professionals are working less on “leakage” and more on “top line revenue delivery” as we get better at the fundamentals of our craft. Unmistakably, the skills and knowledge developed while securing revenue streams is not the end of the value delivered, but only the beginning. By leveraging, good core understanding of telco technologies, operations and revenue management activities, revenue assurance professionals are expanding and applying their knowledge in a myriad of other arenas.

What is beginning to emerge, I suspect, is a number of different specialized revenue assurance clusters which fall under the general heading of Revenue Assurance. Some of the specializations include the following:

Margin Assurance: (Revenue Optimization)

Of interest most often to CFO’s, controllers and heads of operational units or lines of business. Margin assurance focuses on ways to take an existing line of business, product line or revenue producing assets like Switches and BTS’s and increase their profitability by changing the way they are managed or offered to customers. We have seen a large surge of interest in these areas in recent months, and an entire “sub category” of specialized terminology, tools and approaches are being developed to make it easier, faster and more dependable as an approach.

Market Assurance (Revenue Driven Marketing)

While everyone will tell you that marketing is all about increasing revenues, the reality is, that in the end, the revenues they focus on tend to be only those measured in the short term, and under the most strained of interpretation. The dream of almost every CFO/CEO team is to come up with a way to impose clear financial controls on the marketing process without stifling their creativity and effectiveness. The Market Assurance methodology that is emerging offers a lot of promise to financial managers in this regard. By combining the revenue assurance principles of rationalization and integrity to the marketing process, and by supporting it with an innovative new “revenue based control and alarm” structure, many CFO’s and marketing teams, are exploring these new wrinkles in the practice of revenue assurance.

Revenue Management (Integrated Revenue Stream Management)

While managers around the world have appreciated the results that revenue assurance professionals have been able to deliver to their organizations, many realize that what is really needed is to clean up and fix the revenue streams themselves, eliminating the need for a revenue assurance function in many areas. While the wholesale application of revenue management disciplines often meets with unanticipated problems and flaws, the strategic implementation of a revenue management approach can greatly decrease the cost of managing revenues, while containing risks at the same time. What we see is an emerging group of revenue management specialists who work with the results of revenue assurance analysis and turn those results into effective and well run revenue streams.

Traditional Revenue Assurance (The Identification, Quantification, Reporting and Addressing of Risk to Revenue)

While the new and exciting “spin offs” of the core revenue assurance function will undoubtedly continue to expand, the same tried and true core revenue assurance functions will continue to play a key role in telecoms. The ability to deploy teams of experts with the ability to analyze, diagnose, recommend and operationalize corrections and controls across the full range of telco revenue operations is a core skill that will not be leaving us for some time to come.

Revenue Engineering (Using RA to Develop and Integrate New Products, New Services and New Technologies)

the most advanced, and most powerful of the new emerging revenue assurance disciplines is revenue engineering. Revenue engineering is the science of applying the principles of revenue assurance (margin optimization, market assurance, revenue management, and revenue assurance) and losing their focus on the challenges of new product development, new service line development and the assurance of new technologies brought into the telco. What innovative companies are learning is that the application of core revenue assurance principles can do a lot more than simply “protect revenue streams”. What revenue engineering shows is that the proactive application of these principles can actually help to drive the entire value creation process, the real heart of the telco innovation engine.

Revenue Governance – (Unified Framework for the Management of all Revenue Related Functions)

What is also badly needed, and quickly emerging, is a framework for the governance of all of these different functions within the tactical, operational environment of the telco. Revenue governance prescribes techniques and guidelines for the allocation of responsibility for the different risk and issues facing telecoms revenue management, including the coordination of efforts, and setting of operational boundaries between internal audit, revenue assurance, fraud management , security, revenue engineering, revenue optimization and revenue management. The upcoming revenue governance framework promises to simplify and organize the telcos management of this entire operational space.

Over the next few months, I hope to see the GRAPA organization further develop and enrich these areas, and provide members with options for training and certification in one, or all of them.

As always, the only way that GRAPA will be successful, is if you, the membership , participate in this process. In the near future you will be seeing many blogs, webinars, surveys and other ways get feedback from our members about these approaches. Please feel free to participate, and to tell us what you really think.

Well, that’s about enough for today. Until next week, this is Rob Mattison saying … “be safe”.…

In a previous article, I discussed the issue of revenue assurance and our involvement in the assurance of sales channels. As we considered in that article, it was clear that even though sales channels might be considered off the beaten path for the typical revenue assurance team, more and more telcos are realizing that:

a)     Breakdowns in sales channels can have an enormous negative effect on revenues.

b)    Revenue assurance teams are exceptionally good at addressing those risks.

As we said in that article, the decision to include Sales Channels within the charter of a revenue assurance group is not a spurious one, but when it is made, it is critical the revenue assurance team be prepared to do a good job.

The Role of Sales Commissions in Revenue Recognition

A naïve observer might propose that sales commissions and the payment of sales reps and channels for their activities are far removed from what we know as revenue assurance. Indeed, in the classical sense, the payment of commissions is simply a “cost of doing business” with no direct correlation with the delivery of the service.

That may have been true in the “old days”, but in today’s tight margin, highly competitive environment, sales commissions and channel incentives have become a major component in the overall strategy of how telecoms are run. If paying a channel an additional 5% for their efforts will yield an additional 30% in sales it makes good sense to do it. Unfortunately, as seductive as that simplistic logic is, it does not take into account the many perversions of logic that can creep into the organization.

As organizations get more creative in their compensations schemes, and as sales channels learn how to best “manipulate” the system, major revenue leakages can be generated. For example: assume we decide to offer a program that allows for sales channels to be paid $10 for every new sim card they sell. The marketing people do some quick math and say that since an average customer generates $100 (at $.10 per minute) in a year, then paying $10 bonus will be a good business activity. (We simply lower our margin by 10%).

• 1 customer = 1,000 minutes in a year. At $0.10 per minute that should result in a revenue of $100

• I give a commission of $10 for the sale.

• I now get 1,000 minutes in a year, but receive only $90 – meaning that I have reduced my revenue by $0.01 per minute.

Revenue went down a bit, but it is still good business and not a revenue assurance issue. What happens when I make this deal, but the customers that are attracted do not generate 1000 minutes? What happens when I offer this deal and the sales reps bring in customers who end up using only 100 minutes? (How can this happen? Easily–customers churn all the time based on aggressive sales promotions). I now have a customer who generates 100 minutes of traffic – which brings $10 of revenue. But, I paid the sales rep $10 for the commission. So now, is there even any revenue? No.

And taken to the extreme, you have cases where sales reps learn how to “fake” the activations to get the commissions resulting in a negative margin. In other words, you lose money on every sale. In this situation, the solution is a correction. Change the policy so that reps are not paid for the sale of a Sim, but for actual minutes delivered and paid for. While perhaps a bit extreme, our example demonstrates the problem a revenue assurance manager must face when asked to assure the sales commission area.

There are actually two things that revenue assurance needs to be concerned about:

1. The commission programs themselves.
2. The commission program accounting and crediting procedures.

Commission Program Assurance

Accounting for and assuring the composition of commission programs fits squarely under the domain of Marketing and Margin Assurance. (Readers are referred to the GRAPA standards, body of knowledge and certification training modules for details about these domains.) The foundational groundwork in the performance of market and margin assurance is for the revenue assurance professional to perform a complete “risk assessment” of every single program based upon the 6 major risk dimensions. These include:

• Subsidy Risk
• Network Risk
• Market Risk
• Sales Risk
• Billing and Assurance Risk
• Partner Risks

Once each of these risks is considered, a Revenue Model for the marketing initiative is prepared. This Revenue Model explains each of the assumptions that make up the marketing proposal, requires the marketer to provide forecasts along each of these dimensions, and defines the “controls” that need to be in place so the marketing manager can be warned when their forecasted levels are not being met.

It is the development of these models, and the initiation of these controls that define the revenue assurance professional’s job. Tracking the programs and responding to errors is the job of the marketing manager responsible for the program.

So how does this relate to Sales Commissions?

Simply stated, one of the principle “sales risks” to be considered is, “What happens if the sales that occur do not meet the conditions specified by the model”. In other words, if my marketing plan expects that each sale is going to be worth $100 in revenue, and that is how I justify the commission, then I need to be sure that I create some controls that make sure that this assumption ($100 in revenue) is the result.

The definition of the control involves:

a)      Measuring and tracking to make sure the assumption is actually happening.

b)      The definition of an alarm and thresholds that will notify the program manager when the assumptions have gone seriously wrong (when the failure of the assumption threatens the revenue in a significant way).

c)      Defining “remedies” and “adjustments” to be made when an alarm is triggered.

Sales Commission Plan Assurance: Summary

The first sub-domain under Sales and Commission Assurance is the Assurance of the Plan itself.
The purpose of the assurance activity is to provide management with clear information about:

1. The risk to revenue that the commission plan represents.
2. The establishment of objective measures that track the assumptions.
3. The creation of alarms and triggers to make everyone is aware when revenues are seriously jeopardized.

Commission Accounting Assurance

The other major area of assurance for commissions is concerned with the accuracy of the commission (and sales tracking) and the accounting process itself. The best sales and commission program will be worthless if it does not accurately track the sales and services delivered, and provide for the accurate and timely assignment of compensation.

While the vast majority of issues concerning Sales and Commission accounting are a straightforward accounting function, revenue assurance will become involved when management has decided to use the sales and accounting system as the method for managing the sales and commission tracking controls. If sales and commissions accounting is not going to house and manage revenue assurance market and margin controls and alarms, then there is no reason for revenue assurance to be involved.

If, however, this system is going to be the way management automates these controls, then revenue assurance participation becomes critical. The ability of the sales and commission system or process to track the items and variables defined in the commission plan (the things being tracked in the forecast, triggers and alarms) is clearly going to define how well the revenue assurance controls will work in this environment. It will therefore, be up to the revenue assurance professional to get involved to the point where he is sure that they are in place.

Providing this assurance will be completely dependent on how the overall market/margin assurance process is managed. What the revenue assurance professional will need to do is:

1. Assure that those things identified within the Sales Risk component of the marketing model are being accurately fed into the commission/compensation system.
2. Assure that the method of computation for the compensation defined in the model is the method being utilized within the compensation / commission system.

If the revenue assurance practitioner has done these things, they will have met their responsibilities.

Summary:

Sales commissions are becoming a critical ingredient in the diverse “innovative new marketing schemes” being created by marketers and product developers. Assuring that these “crazy schemes” are viable, that they contribute positively to revenues, and that they are being accurately executed can make the difference between success and failure, profit and loss and negative vs. positive revenue margins.

As the industry increasingly puts its faith in these innovative strategic approaches, the ability of the revenue assurance team to get involved, and apply a strenuous revenue focus on these programs will be key.

That’s about enough for this installment, so until next time; this is Rob Mattison saying take it easy and…. Be SAFE.

One of the most exciting and challenging things about the revenue assurance world as we evolve as professionals, is how the scope of our responsibilities continues to expand. Few revenue assurance professionals do not understand the process of tracking and assuring the integrity of a CDR. But many of us are finding that following CDRs is a small part of the job.

Case in point is assuring sales channels. Not long ago people would tell you revenue assurance had no business poking around in the sales channel area. Indeed, Sales Managers did not want anyone else looking “under the covers” of their operations, and for many organizations accounting and internal audit was assumed to be “in control” of those areas.

Unfortunately, what happened to a lot of telcos was…well, what always happens. New sales channels sprang up overnight. Instead of managing one internal sales force, the telco now must manage dozens of teams along with partners, brokers, agents, pseudo-employees and mega channel partnerships. Creative, cost effective and incredibly complicated sales tracking and compensation plans were suddenly created.

In the wake of all of this change came leakage and fraud. In no time, telcos inadvertently invented dozens of ways to lose revenue, use sales tracking to give false information, give sales credit where it wasn’t earned and most critically, to fail to accurately and honestly report revenues.

When this happened, it wasn’t long before the CFOs came to realize the skills and capabilities of the revenue assurance team were the best available to address these issues. And so the “morphing” of the definition of revenue assurance began.

Early RA Efforts in Sales Channel Assurance

The first documented cases of allocating the responsibility for “leakage” in sales channels can be found in the South East Asian carriers. In these markets, the rapid expansion of the role of sales channels to fuel prepaid became the impetus for change. Over the past decade, the trend has grown to where the majority of telcos now include “sales channel assurance” as at least a part of the scope of the revenue assurance team.

Given that sales channel assurance has worked its way into the charter of many revenue assurance groups, what are the details behind it? Luckily, the GRAPA standards spell out the principles and approaches key to sales channel assurance and the GRAPA certification training classes review the standard controls and assurance points in detail. For those who have not had the chance to review those standards, or take the training, we will provide an overview here.

Assurance of Sales Channels – Domain Fit

The first issue for the revenue assurance professional faced with the job of sales channel assurance is to identify which domain it falls under. This is critical, because only by mapping a situation to our standards and body of knowledge can the revenue assurance professional gain any leverage or support for the areas they cover.

When you determine which domains a problem touches, you gain access to the standard controls, approaches, benchmarks and knowledge other revenue assurance professionals have gathered over time. Under the GRAPA standards, sales channel assurance can be positioned in several ways.

First – Channel Assurance is one of the four major domains required to assure the prepaid line of business. It is impossible to assure prepaid billing systems and the entire Prepaid LOB without assuring the company that the sales channels are tight, leak proof and feeding the voucher management system with integrity.

Second – Sales channel assurance fits under the subject of CRM assurance and assuring the different CRM value chains:

a) Sales

b) Customer Service

c) Marketing

Either way, sales channel assurance is critical, and definitely “in scope” according to the standards. When is the assurance of channels part of the charter of the revenue assurance group?  As for all revenue assurance domains, the domain comes “in scope” when:

a)      Management identifies it as a domain of concern.

b)      The operational team invites the revenue assurance team to help.

c)      The losses or risk of loss become pronounced.

When the domain is added to the revenue assurance group’s charter the revenue assurance manager must:

a)      Perform an initial forensic analysis of the domain to rationalize and quantify the extent and nature of the revenue risk and loss.

b)      Prepare a set of recommendations and relate them to specific quantified risk areas.

c)      Review the recommendations with top management and the operational teams concerned.

d)      Implement actions based on management decisions.

Channel Assurance – Objectives

What are we supposed to accomplish when we assure this area? After all, there are no CDRs in a sales channel. What leakage are we trying to address? Experience has shown that when a CFO wants the revenue assurance team to “assure” a sales area, they have some specific problems in mind.

The nature of revenue leakage and revenue loss protection when sales channels are involved has taken a couple of major forms:

1. Inventory and “virtual inventory” related losses – When top-ups and sim cards are not adequately accounted for (revenue producing assets are mismanaged, resulting in the false accounting of revenues, or the “giving away” of services) There are three operational sub-domains to consider in these cases:
   1. Outbound Asset Management Failure – Faults in the process of accounting for the creation and delivery of revenue generating assets (virtual and physical) to the point of sale.
   2. Boundary/Exchange Failure – Fraud or error in execution of exchanges of value with sales persons – when sales channels (internal and external) accept responsibility for revenue producing assets, and they are not accounted for properly.
   3. Inbound – Accounting Failure – Failure to get funds collected properly allocated to the Account Management System and the bank account.
2. Post sales accounting – Inaccurate sales reporting/commission pay out – When the payment of commissions or the allocation of sales credit becomes part of the overall profitability of a service area, then the accuracy of the sales tracking and commission payment domains fall under the charter of revenue assurance as well.

How is this Revenue Assurance?

So now we get to the heart of the controversy for some carriers and CFO’s. How can we justify the inclusion of the assurance of these areas as part of the mission of revenue assurance? After all, these are not direct revenue issues are they? At this point, we are forced to go back to some basic definition of revenue. Under the “Old School” Revenue Assurance definitions the term revenue is used to refer to the monies received for the delivery of a service. Revenue is the money we receive from the customer.

In the good old days of telecoms, when all revenues were postpaid, we provided a service to the customer, we collected CDRs that we used to make a bill, and the customer paid us. In this revenue management chain scenario, revenue assurance was ensuring the CDRs are collected, processed, billed and monies collected from the customer.

The Prepaid “Spin” On The Definition Of Revenue

In the modern telecommunications world, revenue is not that simple to understand. In a large number of carriers, the primary form of business is not postpaid but prepaid. In the prepaid world, monies are collected far in advance of service delivery.

I get client money and they receive a “token in exchange” (i.e.: a top-up card), that is used to top up their online account. When they use the service, an amount is deducted from the account management system. In the prepaid world, in the “purist” sense, revenue assurance is a very trivial process, making sure the account management system decrements the balance correctly. There is no long revenue stream or CDRs, just a brief, instantaneous online transaction. That should mean the revenue assurance job is small and specific. However, it is not that simple.

In the postpaid world, losing money because you didn’t collect from the customer reduces your company’s revenues. Errors in collections come “out” of the revenues counted. Because of that, most people consider the job of revenue assurance to be the assurance of the real revenues, not the legalistic definition of revenue under accounting principles. Whether I am worrying about the “watering down” of my full revenue realized from a failure to collect from a postpaid customer, or a breakdown in the collection of prepaid monies, it amounts to the same thing.

The question is not whether this is a problem, nor is the question whether this has a negative impact on revenues. The question is whether the CFO should include that within the scope of revenue assurance, and is a decision they need to make based upon need, skills and the depth and breadth of the problem.

Once that decision is made, it means revenue assurance must concern itself with the integrity of the process of getting the money from the customer and getting it into the Account Management Systems intact as well as making sure  the “moment of truth” that occurs at the point of revenue recognition is accurate.

And so the “channel assurance” domain of Prepaid Assurance is born.

Objectives of Channel Assurance

The mission of revenue assurance when it comes to channels is fundamentally no different than it is anywhere else. The GRAPA standards specify the particulars. Our job is to:

a)      Identify any and all “risks to the loss of revenues” that the domain represents to the company.

b)      Quantify that risk, both in terms of the amount of money at risk and the probability of that loss occurring

c)      Recommend remedies to management (recommend changes to procedures, or the implementation of controls)

d)      Implement the recommendations that management chooses based upon their appetite for risk.

That’s enough I think for this installment. We will continue to explore these issues by taking a closer look at a couple of the sub-domains under channel assurance, namely, Prepaid Time Assurance and Sales and Commissions Assurance.

Until then, this is Rob Mattison saying… be safe.

This week we had a break in our training schedule, so Brigitte and I spent a week in Germany visiting family. I love Germany. That should be obvious, since I married a German. Brigitte was born and raised in Augsburg in the Southern part of Germany known as Bavaria.

With its beautiful countryside, rolling landscape, forests and farms Germany is a pretty place and always a treat for me to visit. We called on my in-laws, helped my niece Anna with her English lessons and trigonometry homework, and visited the famous Augsburg Christmas market.

However, whenever I visit Germany, I always take the time to engage in my favorite pastime. What I love to do more than anything else is a little game I like to call Autobahn Hanne (Chicken in German). The way you play is simple; you get a rental car, get on the Autobahn (the German highway system) and see how many times you can get your car going over 200 KPH before Brigitte screams in terror.

That is right! In my opinion, the most brilliant thing the Germans ever invented is the Autobahn, the highway system with no legal speed limit. Yup, in Germany, you can drive as fast as you want, and nobody tries to stop you. Moreover, unbelievably the Germans  have a lower accident rate than many, many other countries in the world, with much more stringent speed and traffic laws.

Now, I know what you are thinking. How did the Germans make this miracle happen, and how can I get in on it? Is it because the Germans are genetically better drivers? Do they have better coordination or cars ? Firstly, the Germans are impatient people. They don’t like to wait, and have no tolerance for people who get in their way and slow them down. Trying standing in a queue at the airport with Germans in line and you will see what I am talking about.

The way that they make the autobahn safe is simple. They have figured out the best places to put the roads. They have organized their laws, rules, highways, on ramps, off-ramps and everything else in ways that make the autobahn not only possible, but also safer than roads without that kind of comprehensive engineering.

However, remember, the Autobahn is much more than just a road and some asphalt. It works because of all the different parts of the process work together. It requires the coordination of disciplines: driving, engineering, law and more than anything else, an attitude adjustment.

On the Autobahn, they have laws and rules–lots of them. In fact, they have rules and laws that you do not have in other countries. For example, when you are on the Autobahn, you must always get out of the way if someone behind you is going faster than you. For the Autobahn to work, people have to learn how to get out of the way. Also, on the Autobahn, you can only pass on the left, never on the right. You see, it is not magical at all. The Germans have a structure and rules that allow them to accomplish their speed without compromising on safety. However, who within the telco environment is qualified to figure out how our product and marketing Autobahn should look?

What are some of the things that get in the way of new product developers and slow them down? Network engineers telling them that the product cannot be supported by the existing infrastructure. Billing systems people telling them that the products can’t be billed the way they want it to be billed. Actually, just about everyone involved in the delivery of services.

This new product development Autobahn requires someone who is expert not at any one aspect of the delivery of services, but who understands how all of it fits together, and how it can be “tweaked” in order to get to where you are going with the least obstructions possible.

Let’s see now. Where can we find someone like that? A person who understands the intricacies of network elements, switches and CDRs, billing and customer service. For many, many telcos, the new “hero of the hour” has been, repeatedly, the Revenue Assurance professional. What? Revenue assurance perceived not as “the guys who slow things down”, but instead as “the guys who speed things up?”

Actually, yes I have personally heard dozens of stories of situations where frustrated CFOs, product developers and market executives have turned to the revenue assurance team to help figure out how to “get around’ design and operational problems and help make things work better, faster and safer.

If you to ask me to identify the one thing that presents the biggest opportunity for revenue assurance professionals, and for telecoms overall, it is the identification and inclusion of revenue assurance as a critical component of every product development team. For those telcos who have figured it out, revenue assurance represents the “backbone” of the new product development operation, with new product development support making up to one half of the entire RA team.

So, the next time you listen to a marketing person, CEO or a product developer talk about creating some insane project and launching it much faster than anyone thinks is possible, take a step back and think about the Autobahn for a minute. Is there a way that your expertise, insight and unique set of skills and knowledge can help them get to their destination?

If so, maybe you are ready to join the ranks of more and more revenue assurance professionals who are finding this to be one of the most interested, exciting and challenging aspects of their jobs. And after that, how long before you to start to develop a taste for Autobahn Hanne (Autobahn Chicken). Why not see how fast you can go before you make your CFO scream in terror? It is an interesting thought isn’t it?

Well, enough for now, until next time this is Rob Mattison saying “Be Safe”.

Revenue Assurance Sufi Style

 

R Mattison’s Podcast

 

One of the rewards of traveling is seeing the different ways people around the world live, work and play. During our recent  Dubai GRAPA training event, Brigitte and I took an evening off to go on a Dune Bashing – Desert Retreat. Brigitte, Friday our good friend from Nigeria, and me along with three Japanese tourists were whisked across the dunes of the Sahara dessert in SUV’s and Humvee’s at incredibly high speeds. After a 45-minute drive to the middle of the dessert, the adventure began. At the end of the ride, we were to be left at a dessert “oasis” and offered local cuisine, camel rides, and the opportunity to bargain for stuffed camel dolls and watch local entertainment.

I was very worried about Brigitte on this outing. Brigitte gets sea and airsick all the time, and the people at the tourist board warned us not to eat lunch, since there was a good chance that we would “lose it” after the wild ride through the dessert. But, off we tore through the dessert, up one dune, down the other, swerving, falling, twisting and turning. At first, it was exciting. Then after about 15 minutes, my stomach started to get funny and my skin turned an odd shade of green. Yes, I got motion sickness.

Brigitte had a great time, screaming and enjoying herself, but by the time we got to our destination, I could barely stand I was so nauseous. We were dropped off and I fell to the desert floor, staring at the sky, hoping the world would stop spinning. After I recovered, they took us to our oasis. The food, socializing, music and dancing were quite interesting.

For those of you not familiar with Middle Eastern cultures, there is a group in the Middle East known as the Sufis who are famous for, among other things, their style of dancing. For the Sufi, dancing is a form of prayer. This is accomplished by spinning around and around and around to the music, faster and faster for minutes and minutes.

It is amazing to watch, and I cannot imagine how the dancers do it. The Sufi dancer we watched just kept spinning around to the music. After some time, his assistant started throwing things to him. The most amazing thing was his incredible sense of balance. Of course, after I had just had trouble standing up after a few lousy minutes in a jeep, here is this person spinning around faster than a top maintaining perfect poise and balance.

The feeling of being turned in a million different directions, and being “dizzy” and suffering from vertigo is no new experience for the revenue assurance professional. We are constantly tugged and pulled in different directions, and many revenue assurance professionals complain about being unable to “get their bearings” when it comes to exactly what they should be doing and where they should be focusing. The image of the Sufi dancer, spinning and spinning with perfect balance and harmony is a fitting image for what the truly talented revenue assurance professional should be.

I recently read an interesting article about the challenging “balancing act” that all professionals need to deal with, and I thought it would be good to share some of it with you. As professionals, especially as revenue assurance professionals in telecoms, there are several contradictory things we have to keep in mind as we do our jobs. Several things require us to continually balance our approach to problems, including:

Taking the Initiative vs. Following the Rules

One thing that managers complain about more than anything else is employees who do not take initiative to identify problems. Clearly, for the revenue assurance professional, waiting until someone tells you to check into things can mean the difference between preventing a crisis and dealing with a major revenue loss disaster. Initiative, the willingness to be proactive and to anticipate problems is a highly valued trait.

On the other hand, being proactive is not license to behave in an unrestrained manner.  Good professional behavior is guided by the social and business-related expectations of coworkers and managers across the organization. The balancing act is this:  To show initiative and independence on the one hand; while observing the prevailing social norms and the expectations of business associates on the other.

For example, managers often expect their direct reports will get things done more or less independently, without constant direction from above.  Employees who are “initiative-takers” and “self-starters” are valued…up to a point.  The balancing act for employees is to take initiative that is bound and guided by the strategies of their supervisors and the overall mission of their firm.

Acting professionally means demonstrating individualism in ways that are subtle, observe locally prevailing norms of behavior, and do not annoy or unduly distract the others with whom one is interacting.  It means not demonstrating one’s individualism in ways that strongly call attention to oneself.  Second, acting professionally means taking initiative on behalf of the firm in ways that support the strategies of one’s superiors.  Initiative is properly directed in support of the employer’s objectives, not one’s own unique ideas.

Pushing for Solutions without Offending People and Seeming Rude

The telecom industry, more than any other, admires self-reliance.  Individuals are able to be self-reliant, in part, by obtaining what they want through acting assertively towards others.  Personal assertiveness, or “directness,” is often expected, but too much of it can be interpreted as being aggressive.  The difference
be
tween enough and too much is determined by the employee’s sensitivity to others.

Similarly, self-assurance is good…to a point.  When it shades over into arrogance – a demonstration of one’s certainty that their own view is infallible – others quickly react negatively.  It is never complimentary when someone is viewed by others as opinionated, dogmatic, or arrogant. One of the biggest problems that we face as revenue assurance professionals is the tendency to translate our opinions, no matter how well researched or justified, into dogmatic declarations of this is how it works.

In our GRAPA training events, one of the first social challenges we face when we get revenue assurance professionals from different carriers together, is to teach members to communicate in ways that are not so dogmatic and absolute. I cannot tell you how many times I have had to caution people who make statements like; “This is how it is done,” “Everyone does it this way,” or “You have to do this.”

Being bold and definitive is a natural reaction to situations where we are unsure of ourselves, or surrounded by people who know less than we do. However, there is a difference between respectful confidence and aggressive bluster. Acting professionally means being flexible in the practice of our assertiveness and self-assurance. It means making sure we vary our assertiveness based upon times, situations, and people.  This ability to adapt our level of assertiveness must be managed by our awareness of the likely effect it will have on others.  The professional constantly tries to be sensitive to others, thereby learning how to modulate his or her behavior.

Respecting Deadlines but Being Flexible and Patient with Problems that Arise

In the hectic world of telecoms, executives and coworkers are highly conscious of time. Activities are scheduled in advance, and people follow these schedules as much as humanly possible.  Activities are expected to begin
and end on time. Being punctual is about being sensitive to the needs of others, who are also following preplanned schedules.

People also have many responsibilities and tasks to attend to daily.  Sometimes a particular responsibility or task, may take more time to accomplish than might seem reasonable.  So, along with punctuality, one needs patience.  Being patient is about being sensitive to others’ workloads and priorities.

Two related points need to be made.  First, managers take deadlines seriously.  When a task is clearly high-priority and/or its completion is critical to the work of others, the deadline should be met.  It is not good to miss a deadline.  However, one should agree in advance only to a “realistic” deadline. Second, for many, family responsibilities take precedence over business responsibilities.  In many business settings, a person’s explanation for lateness or a missed deadline will be more readily accepted if a family emergency is the reason.  Note, however, that this is not uniformly true!

Acting professionally means being conscious of other people’s constraints with respect to time and timings.  One respects other people’s schedules by arriving on time and meeting deadlines that are viewed as critical.  But one also respects coworker’s and manager’s huge load of responsibilities by not constantly prodding them about the completion of tasks. . . other than the most critical tasks.

As we can see, the job of the revenue assurance professional, like the balancing act of the Sufi, can only be accomplished with a great degree of care and practice. Our Sufi dancer didn’t learn how to be well balanced in one day. He practiced for years to accomplish the level of skill he exhibits.

In the same way, we revenue assurance professionals must constantly stay aware of, and focus on our need to find the right balance in our professional practice. It is a full time job for anyone to:

• Be sensitive to the individual egos, and the needs and constraints that our coworkers face, while being patient as they figure out how best to do a job in a productive way (the consensus principle).
• Be assertive, and promote what is right for the good of the company, (the integrity principle).
• Do this in a way that focuses on maximizing revenues to the firm (the rationalization principle).

I hope that you find, as I did, that this way of looking at our jobs offers some interesting insights into some of the ways we can improve ourselves in our professional practice.

Well, I think that is enough for this time so, until next week, this is Rob Mattison saying… BE SAFE.

Revenue Assurance and Internal Auditing – Training in Kuwait

R Mattison’s Podcast

Recently, we finished yet another breakthrough-training event for GRAPA. I was privileged to provide our core curriculum class to a room full of experienced telcom internal auditors from around the world.

This event, sponsored by Protiviti, Internal Audit provider to telecoms across Asia, Africa and the Middle East, saw 30 IA professionals certify in Revenue Assurance, with many opting for the special training and testing verifying their expertise in IFRS, GAAP, FRAUD and Internal Audit.

The group was brilliant, providing excellent proof of the professional competency and caliber of the internal audit profession. For those who thought internal auditors were not qualified to understand or wrestle with complex RA, Systems, Network and Operational Issues I can only say that “the proof is in the test scores”. As is common at training events, we had our share of controversy, and the revelation of a wide range of different personal experiences and “war stories” helped everyone better understand how big the IA and revenue assurance job really is.

This event reinforced my belief that in the battle for revenue assurance and fraud protection, there is a clear synergy and need for cooperation between the Internal Auditor and the Revenue Assurance Professional. This imperative is not new. GRAPA benchmarks have shown that Internal Auditors are traditionally the primary providers of requirements, and feeders of new domains into the revenue assurance arena.

More importantly, what became clear to this group of auditors was the many ways they can look to revenue assurance as their partners in discovering and containing revenue risks. Time after time, an auditor has come to me and said, “Oh my goodness, I should have turned this over to the Revenue Assurance team immediately!” Or, “I had no idea that things were this bad everywhere. I always assumed I simply didn’t understand what was going on, even though I thought something wasn’t right”.

Most interesting were our discussions about the various ways fraudsters penetrate the environment and steal money from the most obscure corners of the operational framework. I know that I speak for many revenue assurance professionals when I say that the enhancement of the knowledge, skill and insights that the internal auditors bring to the organization is a welcome addition to the battle that revenue assurance professionals fight every day.

Too often, I hear stories about revenue assurance professionals, when after identifying risks and communicating them to the CFO, were told the Internal Auditors signed off on them and they were overreacting. Nothing can be more frustrating then to have the proof of a problem and then have it dismissed because another operational area misread the situation. For this group of auditors, and the dozens of Internal Auditors we have already certified, this will no longer be the case.

The Auditors in our class came away with a great belief in the GRAPA standards based approach to revenue assurance; specifically that:

1. The primary purpose of revenue assurance is to:
   1. Build consensus based solutions within the organization
   2. Do their job with integrity and fairness
   3. Be sure that solutions are rationalized

And that the revenue assurance professionals’ primary responsibility is to:

1. Identify risk of loss
2. Quantify it into financial terms that everybody can relate to
3. Address that risk based upon managements appetite for that risk
4. Assist in the implementation of Corrections, Controls and Compliance reporting

Just imagine a world where the Auditors and Revenue Assurance professionals are on the same page. That is an exciting prospect.

For more information about what our internal auditors thought about the training and testing, and how they are putting it to use, check out the following sources:

1. The RA-Academy – Testimonials Page
2. The GRAPA Certification Site
3. The GRAPA Peeps – Blogs and the GRAPA Voice Newsletter

Yes, it is amazing what we can accomplish when we get together and work based on the same playbook. That is exactly what GRAPA is trying to accomplish (and what we actually are accomplishing in location after location).

Stay tuned for more partnership stories and opportunities to advance your career and the revenue assurance of your operating companies.

Until next time, this is Rob Mattison saying.. “ BE SAFE”.

Recently, the 500th student went through GRAPA Revenue Assurance Academy core training and this milestone inspired some reflection. Certain myths about the function of revenue assurance continue to prevail. I would like to open up the dialog in an effort to demystify  the twelve most common myths of revenue assurance.

Myth 1:

Search ‘revenue assurance’ on the internet and you will find many websites, including major standards organizations and conferences, still defining the role of revenue assurance as the management, counting and accuracy of CDRs. It is frustrating for those involved in revenue assurance to constantly deal with the myth that the revenue assurance job is the task of CDR rustlers. CDRs were the only way to count revenues in the bygone days of the incumbent, wire line, post paid companies. It worked because telcos only had one product and service, and billing was the process of counting CDRs and creating bills.

But, having arrived in 2009, we see the biggest sector is no longer post paid voice, but prepaid. In a prepaid billing situation, there are no CDRs. A prepaid billing system works directly with the switch, allowing you to place a balance up front and subtract from that balance. CDRs have nothing to do with the billing process. So how can the statement ‘revenue assurance is about CDR counting’ be true when the majority of the carriers make 95% of their money from prepaid? Is revenue assurance only about post paid, but not prepaid business? The big revenue is in prepaid and that is the revenue that needs protection. Over the last five years, billions of dollars in revenue have been lost because of the inadequate assurance of prepaid billing systems.

While revenue assurance groups continually boast about their phenomenal CDR tracking systems and the intricate reports that they can generate, companies lose millions of dollars to fraudulent, defective, incomplete or confused assurance practices in channels, roaming revenues, and interconnect. CDR management continues to play a role in revenue assurance albeit a rapidly diminishing one. The majority of telcos have only started to understand that the real risks to revenue come in areas other than CDRs.

Even more critical is that good CDR counting does not prevent revenue loss. Prevention of loss comes through proactive revenue assurance with the use of change management, synchronization and other control techniques. We are seeing the scope of revenue assurance expand dramatically with additional challenges in the areas of sales channel assurance data, GPRS, SMS, credit fraud, risk assurance and new product development. However, as long as the myth of CDR counting prevails, companies will leave themselves open to unnecessary risks in these areas and will continue to waste resources on reactive rather than proactive assurance measures.

The CDR myth conflicts with the GRAPA standards and principles, the most important being rationalization: ensuring the time and money you spend on assuring an area is equivalent to the amount of revenue risk it represents. According to GRAPA standards, the mission of revenue assurance is to attain the maximum containment of risk to the company’s revenues, at the lowest possible cost. Spending your entire revenue assurance budget on CDR counting will not accomplish that objective.

Recently, the 500th student went through GRAPA Revenue Assurance Academy core training. Reaching this momentous milestone inspires some reflection.

In meeting revenue assurance professionals from China, South East Asia, Australia, India, Pakistan, Bangladesh, Egypt, Saudi Arabia, Africa, Argentina, Mexico, Colombia and Chicago a few things have become apparent:

• The practice of revenue assurance is moving in a consistent direction no matter where you go, being helped to no small degree by the GRAPA standards and other consensus building activities
• Revenue assurance professionals are alike wherever they practice. They are highly intelligent, risk takers, good negotiators, take pride in their work and work tirelessly and diligently.

However, regarding the actual function of revenue assurance, certain myths that the industry has come to accept continue to prevail. These myths are often based on falsehoods created by vendors, special interest groups, or antiquated ideas that no longer apply as we face new technology and services. In our training classes, we spend much of our time teaching people that these standard myths are not de facto, and that they may actually inhibit the revenue assurance manager from performing their role and getting the success and recognition they deserve.

I often hear these myths quoted and I have decided to do something about it. On the event of surpassing 500 students, I would like to explore and dispel these “myths” and open up the dialog in an effort to demystify the twelve most common myths of revenue assurance.

Are you assuring your mediation systems well enough? How can you tell? GRAPA benchmarks help members learn how to:

• How other carriers manage their mediation
• Who typically is responsible for the checking of mediation activity
• How often alarms are generated
• What typical levels of filtration, suspension, error and consolidation are utilized
• How compliance and reporting to top management is handled

How does benchmarking work?

• Log onto the GRAPA Benchmark Page Click Here to take the Mediation Benchmark
• Answer the questions
• When the benchmark is completed, you will get a copy of the report summarizing the answers provided by participants.

Which controls are most commonly employed?

• CDR Serial Number Verification
• TTFile Serial Number Verification
• CDR Count
• Minutes In / Minutes Out
• FSEC Compliance and Activity Levels

Background:

Mediation systems play a key role in the management of revenues for the vast majority of telco’s. Not only are traditional postpaid voice, interconnect and roaming revenues processed through the use of mediations systems, but more and more these same systems are being called upon to assist with the assurance on non-voice, value added services, content, data , GPRS and other revenue streams. Even more critically, many telco’s find that they need mediation systems to assist with the assurance of prepaid revenues as well.

The assurance of mediation systems is a cornerstone of revenue assurance practices for most telco’s and understanding how different organizations assure them, and how their environments are configured can be of incredible value to the revenue assurance professional.

Objectives:

The objective of this benchmark study is to collect a representative sample of standard practices, architectures and configurations in order to assist revenue assurance professionals with an understanding of what standard practices are in the industry, and how they can most effectively adapt their approaches to maximize revenue assurance and minimize the cost of performing that activity.

This survey is made up of 5 major sections:

• Architecture, software and support environment
• Operational Support Environment
• Forensics Support
• Controls Management Policies

Click Here to take the Mediation Benchmark

When it comes to revenue assurance there are a number of areas of concern.

We need to be aware of our organizational positioning and the way that we integrate revenue assurance into the overall operational framework of our companies. We need to worry about the technology, the systems, the organizations and the environmental factors that make up our environment, and that make revenue assurance easy or hard. We need to understand that in the final analysis, what most people want to know is: how exactly is it done? What are the standard practices that people follow in order to do revenue assurance in this area? How do I know if I am doing too much, too little or just the right amount? This is where Standard Practices come in.

The GRAPA standard practices library attempts to pull together a complete inventory of the various methods that people use to assure particular areas. After collecting the information through benchmark studies and interviews we pull together the best approximation possible of a Standard Practices portfolio. This portfolio provides GRAPA members with an understanding of key areas to watch, and what the standard approaches are to assuring them.

In this series, we will share with you the different perspectives that the membership has on the standard, best and worst practices reported. Our objective in this case is to let everyone know what our current knowledge of standard practices is, and to give everyone a chance to “weigh in” about whether the practices:

1.    Make sense – Is this framework logical.
2.    Are realistic – Are these practices realistic and applicable in their cases.
3.    Are comprehensive – Have we missed anything important that you are aware of.
4.    Are followed – are they actually followed by your organization?

Our practices track will couple an online benchmark survey encouraging all members to let us know how they practice assurance in the area under review, postings to blogs, with commentary, feedback and insights provided by our panelists and townhall (live webinar) and recorded (YouTube) presentations which will help illustrate the points.

We hope that you find this series informative and helpful.

The standard format for the lead article will be:
1.    Background: A definition of the area, the functionalities and issues surrounding the area.
2.    Context: A review of the current operational environment typical for the area.
3.    Controls Inventory: An inventory of the standard controls most commonly found associated with the area.
4.    Range of Practices: A review of some best, worst and standard practices experienced by the contributor.
Please feel free to review, comment upon and make use of what we hope will be a very informative and useful series.

Continued – Standard, Best and Worst Practices in Mediation Systems Management